tv Viewpoint With Eliot Spitzer Current July 31, 2012 5:00pm-6:00pm PDT
there they have tremendous growth. we don't. what happened? low taxes wasn't supposed to give us growth but it did. i'm sorry, not give us growth. all right. out of time. "viewpoint" with eliot spitzer is next. >> eliot: good evening. i'm eliot spitzer and this is "viewpoint." mitt romney wrapped up his whirlwind foreign tour today but he may be coming home to an even bigger disaster than he created over there. in an interview with "the huffington post," senate majority leader harry reid dove head first into the discussion over mitt romney's tax returns. reid says about a month go, a former investor in bain capital called his office and said romney didn't pay any taxes for ten years. zero. i quote...
i think everyone can agree that would not look good. but as much as romney's refusal to release more tax returns flies in the face of the president set by his own father, some still don't believe he needs to do it. >> if he had two years out then four. if he had four years out, they would want six. if he had six years out, they would want ten. >> what would you tell them? >> do what he feels like doing. this is his decision, fine, let's get on with it. >> eliot: in 2000 when cheney and then governor bush released ten years of tax returns it didn't appear to be much of a distraction. president obama's campaign team ignored dick cheney's advice. >> was there ever any year when you paid lower than the 13.9%? >> i haven't calculated that. i'm happy to go back and look. >> abc news reached out to the campaign today after romney's
answer, a spokesperson would only reiterate mitt romney has paid his taxes in full compliance with u.s. law. >> eliot: but even with reid's accusation, it is likely romney will handle this new push for his tax returns the same way his traveling press secretary rick gorka handles the media. >> governor romney, do you feel your gaffes have overshadowed your foreign trip? >> show some respect. >> we haven't had another chance to ask him questions. >> this is a holy site for the polish people. show some respect. >> eliot: there you have it. let's bring in two reporters who always do show respect. rolling stones national political correspondent, tim dig.genson and joe williams, thank you both for your time tonight. unfortunately -- unfortunately for mitt romney, not the way he wanted to end that trip, no doubt. certainly not his press secretary who's making more news than he ever wanted to.
joe, let me begin with you. harry reid the tax returns where does this come from? this was a call a month ago. suddenly this is harry reid's welcome home gift from mitt romney diving right back into the tax issue. what motivates this. why now? what do you make of it? >> it is a big pie in the face for mitt romney. at the end of a trip where he's been stumbling on banana peels tripping over skates in his path. it is a whole trip that's been nothing but -- to come home to yet another one. this is probably the ultimate of unforced errors. harry reid very much is putting out the democratic message here. he's doing what i think is kind of interesting in borrowing a page from the republicans' handbook in that he's placing allegation there not substantiating it but saying hey, this is out there. i wonder what's behind it. it almost reminds me a lot of what the birther nonsense was about in which people were constantly asking for obama's birth certificate.
i take him at his word he's an american but really we want to know was he born here or not. so it is kind of interesting that all of this is going on. i think that if the white house is not implicit in this, i don't have any evidence to suggest that they are but if they aren't then certainly they know this is part of what the message will be for the week and that romney is coming home to a less friendly welcome. >> eliot: certainly the white house is saying we don't want to be the messengers here continuing to throw the tax bombs. it is a little undignified for the president to continue to do it. harry reid, you just got re-elected. you're not running for re-election. you do it. the metaphor, the pie in the face for romney. we're thrilled your back onshore and now you can deal with the tax issue once again. also a hard issue to respond to an unnamed former investor without any additional clarity mitt has left there saying but i did. i complied with the law and keeps the ugly story alive for him. what's your bet? does he now cave and release tax
returns or at least in response, you saw the clip of the ad there, give us more data saying look for the past ten years here's the percentage i paid even if i'm not giving you the actual returns themselves. >> well, there are a couple of cures things at work here. cheney's response that if he gives two they'll ask for four. if they ask for four, they'll ask for 12. there's nothing that says you have to release your tax returns in order to be qualified for president. generally, it is only age 35 and a u.s. citizen but this has been a custom for a long time and by flying in the face of customs so arrogantly and so forcefully, it really does look like he's got something to hide. my wager is that he's probably going to hang on as long as he possibly can without releasing them but certainly at some point, he's going to have to do something and when his 2012 -- 2011 taxes which he's pledged to return come out that's going does trigger -- that's going to trigger the allegations give
new oxygen to the story. he will have to do something or see serious damage done to his campaign. >> eliot: let's put the tax issue aside. it should not be the fulcrum of the presidential election. tim, let's turn to you. give us the wrap-up on the overseas trip. win or loss for mitt romney. do the stumbles and the bumbles the slaps to the brits the palestinian cultural difference then the cur fuffle with his press secretary do those outweigh by whatever he gained, giving a speech of some people will evaluate it differently. i didn't think it was substantive, giving a speech on the merits in jerusalem. >> he completely stepped on what could have been a very nice trip for himself. every presidential candidate gets this chance to go off and troop off overseas and look presidential and mitt romney certainly looks like a president out of central casting but not -- he can't seem to not step in it everywhere he goes. so somebody liken this to striking out at tee ball. this isn't a case where you have
the obama folks dodging him left and right. he was able to set the agenda here, take a break from the scrum of the day-to-day political reporting and try and give a few good speeches and really just muffed the opportunity. i don't think it is going to damage him hugely in the long-term but it certainly was a missed opportunity. in seven days he won't get back. >> eliot: the contrast of it that resonates with me, i agree with you, it was not a huge event one way or the other. no upside, wasted seven days. the emotional distinction between his overseas journey and obama's four years ago when he went to the brandenburg gate and had thousands of germans sitting there applauding him, it was as though barack obama was representing the new america the new face of america after george w. bush. certainly mitt romney had a very different sort of trip. enclosed a few personal meetings, none of the public euphoria that greeted barack obama. i'm not sure that has translated into anything meaningful in terms of foreign affairs.
the emotional content was different four years ago for barack obama. so it is hard to know other than the few constituencies and certainly jewish voters in florida, new york and elsewhere with the israel trip, hard to know what he picked up in terms of practical political value don't you think, tim? >> people try on their candidates for size, right? this is an opportunity for people to look at mitt romney and say hey, what would it be like to see this guy representing america for the next four years eight years? i think he just didn't give anybody anything to latch on to. in fact, just kept stepping in it and sort of the worst way that j h. w. bush -- that george h. w. bush would have. it is not somebody you want to see on tv every night representing america if he's insulting our favorite allies in britain and making bizarre sort of quasi-racist statements about the palestinians and even sort of praising the israeli culture in uncomfortable ways. he proved himself as awkward on the international stage as he
seemed at times on the domestic stage. >> eliot: tim, i've described him as the most awkward politician in history for months now. maybe it is a low bar high bar. >> given richard nixon that's something. >> in contrast with barack obama who has led a very successful domestic -- foreign policy presidency and you know, has behaved in a very distinguished and -- i just don't think anybody is questioning his international leadership. this was a chance for mitt romney to sort of pose a serious challenge there and i don't think he rose to the occasion. >> eliot: joe, let me come back to you for a minute. announcement the mayor of san antonio mayor castro is going to deliver the keynote speech at the democratic convention, is the big winner here marco rubio does mitt romney have to put rubio on the tirkt because the democratic party so clearly willing the latino vote. how does romney respond and what is the impact of all of this? >> i think the impact is significant because again, at a democratic national convention, i mean it can't compare to four
years ago but at a democratic national convention, you were going to see history in the making. you're going to see the elevation of latino politics to the national stage. i think that's something that's quite significant and i think that's something that romney is going to have a hard time competing with. he doesn't necessarily have to put rubio on his ticket. he does have to make fair use of him and he also has to come up with a coherent message that latinos will be receptive to if not necessarily immigration certainly on the economy and fairness because a lot of latinos aren't earning the kind of income that they feel like they deserve along with the rest of us. but he's got to find some way to appeal to that constituency. i want to go back for a minute to mitt romney's foreign trip. even know not much substantially came out of it from a political standpoint, do you have a man who is auditioning to become the leader of the free world. and if he's going to get that job, part of that job entails becoming the chief diplomat for the united states.
remember how eager people were to receive barack obama as the new president? there was a glow. there was good feelings, it was easier for him to negotiate and get things done, particularly in western europe and in germany and so forth. to have that sort of deficiency right off the bat with president -- with romney who presumably could become president, that's a liability that the american people are going to hear about especially when it comes time to debate foreign policy issues on the campaign in november -- or october and november. >> eliot: tim let me turn quickly to you. joe, i think the answer is mitt romney is going to give a speech and recommend self-deportation and no taxes for the top 0%. that will help him. if you're mitt romney's advisers, you're saying please, give an economic speech of some magnitude that actually wheels out some new ideas. is he going to do that in the next 48 hours or wait for job numbers on fridays and comes out with what he hopes to be the game changer early next week?
>> romney's strategy so far is to be very cautious. i don't see him changing that pattern. i think he will be rooting for bad news and hope that president obama takes it on the chin there. i don't really expect any big bold substantive from him. he seems to be betting he can win this by having obama lose on the economy. >> eliot: maybe he will propose something creative like dropping the capital gains rate again. that's worked so well for the last couple of years. tim dickinson, rolling stone's national political correspondent, joe williams, thank you for your insights tonight. >> my pleasure. >> my pleasure. >> eliot: can we do anything about gun control even justice scalia says maybe we can. crazy as his views may be. more "viewpoint" coming up. >> this court has proven to be the knowing, delighted accomplice in the billionaires' purchase of our nation.
>> eliot: india's problems are thousands of miles away from us but they're also right next door which brings us to our number of the day. more than 600 million. that's how many people in india were hit by a power outage monday or at least lived in one of the 28 states where the lights went out. give india credit. they do things big. this is the largest blackout the world has ever known. 600 million or about twice the u.s. population. even so, if this were 30 years ago, the blackout would have been a story in the newspaper. none of it would have affected us. and would have seemed literally a world away. but now as we know, a lot of routine phone calls go from the u.s. to india. one outsourcing company lists services ranging from engineering to healthcare to photo editing. so with half of india's power
knocked out, the odds are high at some point in your life, you've talked to one of the blackout victims and maybe you'll try to call them today or tomorrow. one other reason the blackouts should give us pause our own electrical grid could stand some improvements along with other parts of the infrastructure like roads and bridges. india can serve as a reminder mumbai is literally a phone call away. when the power goes out there, we feel it here. our conversation is with you the viewer because we're independent. >>here's how you can connect with "viewpoint with eliot spitzer." >>questions, of course, need to be answered. >>we will not settle for the easy answers.
>> eliot: there may be hope for new gun control laws afterall. new jersey senator lautenberg would restrict access to high capacity ammunition clips. both were acquired and used by james holmes charged monday with 23 counts of first-degree murder and amendmented murder. for the shooting at the aurora, colorado shooting. holmes opened fire on the crowd watching batman, the dark knight rises. that drum would be banned under amendment to the senate cybersecurity law proposed by lautenberg along with any clip that holds more than ten rounds. the conservative heritage foundation attacked his proposal saying... but while a congress coired by the national rifle association hasn't passed new gun control laws since 1999, no less a conservative than supreme court justice antonin scalia told fox
news they're allowed under the constitution sometimes. >> there are some limitations that can be imposed. what they are will depend on what the society understood were reasonable limitations at the time. they had some limitations on the nature of arms that could be born. so it -- we'll see what those limitations are as applied to modern weapons. >> eliot: scalia admitted as much in 2008 when he wrote for the court's majority in d.c. versus heller which struck down washington's handgun ban and i quote... but where scalia would draw the line is still unclear. >> obviously the amendment does not apply to arms that cannot be hand carried. it is to keep and bear but i suppose there are hand-held rocket launchers that can bring
down airplanes that will have to be -- it will have to be decided. >> eliot: if i'm stronger and can carry a bigger gun, i have more constitutional rights. i don't know where they come up with what is almost unsane legal theory. lautenberg and carolyn mccarthy are pushing another bill to stop the sale of ammunition online. james holmes acquired more than 3,000 rounds over the internet before his shooting spree. for more, i'm joined by jacki executive director for new yorkers against gun violence. thank you for joining us tonight. obviously the horrific event puts gun control back on the map politically, legislatively. does it change where you think we'll end up in terms of congress's capacity to pass a meaningful gun control? >> i think after a shooting like aurora members of congress will go back to the districts will, hear from their constituents and say if i can't have an expectation of safety in a movie theatre on a friday night or in a supermarket parking lot something's gotta change.
i think most of the american people are with us in believing that something's gotta change about our gun laws. >> eliot: where is the law right now? congress has been told we haven't had new laws. d.c. versus heller was not an affirmative decision for those of who you believe in gun control. congress has been unwilling to pass a law that would ban semi assault reps or any limitations on the sale of ammo that obviously holmes got his hands on. what should be proposed? what is the sort of bill that could make it through? >> well, i think the kind of legislation we're talking about tonight banning high capacity magazines and also regulating the sale of ammunition are an important place to start. because high capacity magazines and really assault weapons like the one that was used in the aurora shooting are direct descendants of military weapons. i think our country needs to come to grips with the real question, do we want military weapons in circulation in the general population, used by anybody who wants to get them. there's no way we can detect people's mental illnesses.
i mean psychiatry has been trying to do that for years and hasn't been successful. we can't predict it. what we need to do is make it as difficult as possible for people who have those kinds of failings like mental illness to get ahold of weapons that can really do this kind of damage and there's a consistency to all mass shootings and all mass shooters know enough if they've got a high capacity weapon with a magazine like the one that was used in aurora that can do more damage. >> eliot: yet we still can't get congress to have limitations on the sale of ammunition or semiassault weapons the distinction between gun that might be useful for hunting or traditional sportsmanship or on the other hand guns that have no utility as the cartoon said. you don't see deer wearing flak jackets. let's be real here. there has to be a boundary line there. does the lautenberg amendment have enough support in congress? >> i think every member of congress has to start by reading the heller decision. it is all laid out in the heller
decision. the court is clear the second amendment is like every other amendment. it is not absolute. it is result of balancing the interest of people being face in the their communities with the interest of gun owners. whenever you hear from any politician, you never about the other side of the public safety issue. part of upholding the constitution, every elected official swears to uphold the constitution is to keep the public safety. they need to start focusing on that part of their constitutional responsibility. >> eliot: you heard justice scalia who believes this sort of originalist block on the supreme court whose views are grounded in what did those words mean when the text itself was being drafted? talk about what could somebody actually bear? the right to bear arms? what could somebody carry around at the time this document was being drafted? did that make any sense to you contextually, as a barrier in terms of a fine line of what guns can and cannot be sold? >> i'm not an originalist. i would never agree with that. since that's the law of the land and it was repeated in the
mcdonald case, we have to take it at face value. justice scalia chooses his words very carefully. one of the things he talked about is the historic prohibition on certain types of dangerous weapons. in the segment that followed, the clip you just showed, he actually talked about a tort back in the days when our country was first formed where it was against the law to carry a weapon that would frighten your neighbors. he used that as an example -- >> eliot: battle-ax. can i interrupt? by tort, you mean a form of legal action not a dessert. >> yes. exactly. i'm talking about a legal action that would result in a misdemeanor and in that case, he said it was a criminal misdemeanor. so i think that's an important thing for us to focus on. even back then, there were restrictions on the places where people could carry. some places like in massachusetts, you couldn't bring your arms even though you could possess them into the town square because it was considered a crowded place. i would argue that that's the same kind of restrictions that we should have here in new york city where we have more than
eight million people. >> eliot: but he also -- i found it to be the bizarrest part of the clip said gee, maybe a rocket launcher, you could carry, he wasn't sure where the law would come down on that suggesting maybe we couldn't ban the sale of rocket launchers. that one could carry around a shoulder-based rocket launcher part and parcel of what our military uses overseas. that stuck me as an rant in terms of where the public consciousness is. >> that struck me of being outside of any kind of realm i would like to join in as well. i'm hoping he was just using and considering the worst-case scenario and that he would return to what he said in heller was that there could be reasonable regulations as to people places and types of weapons. i'm going to take him at his word in heller because that's the written part of his thought process. i think that's an important distinction that everybody needs to focus on. >> eliot: the problem we have to come back to the politics of this for a moment, we have a horrific incident like aurora, colorado. for two weeks we talk about gun control. everybody says jacki come on the show. it fades away.
we don't have either presidential nominee candidate talking about this. willing to stand up and say here's what we have to do. where is the leadership at the national level? frank lautenberg, chuck schumer few others are good. where is barack obama? will mitt romney ever go near this? how do we crystallize the support absent the president who talks about it? >> i think we need to bring it to their attention in as many places and in as many ways as we can. it has happened in so many states, the college campus in virginia, virginia tech. it has happened in arizona a member of congress. and now -- we don't have to have one in all 50 states to have our elected officials pay attention to it. they should be able to extrapolate if it can happen in aurora, it could happen in yonkers or new jersey. people need to face the consequences of a decision that they do by not doing anything. i don't know who it was that said when good men remain silent, that's the worst kind of evil as possible. i think our elected officials need to stand up and start talking about this because americans are dying in movie
theatres. children are dying. 6-year-olds are dying unborn children are dying because their mothers were hit by guns. it is a national disgrace. we need to start talking about it. >> eliot: the numbers are horrific. the story lines bring tears to one's eyes. you see the pictures of kids who were killed in the movie theatre and yet our politicians still have the backbones of amoeba. it is a sad, sad state of affairs. jacki hill imhiy executive director for new yorkers against gun violence. thanks for your time tonight. >> eliot: another controversial hobby dressage. the viewfinder coming up next.
>> the london olympics are finally underway. i tell you there is nothing like the thrill of seeing team u.s.a. triumph in an internet headline and then waiting to see it confirmed on nbc seven hours later. >> nbc is under controversy for his tape delayed broadcast of the olympics. >> like the olympics this show was taped 15 hours ago at a pool. don't tweet the result, okay? >> the headline here is if you're watching the olympics in the u.s., bury your head in the sand for the whole day or stick it in a jar of mayonnaise or something. >> the sport of the summer, dressage! >> dressage. >> dressage event. >> dressage. >> dressage competition. >> dressage horse. >> mrs. romney's dressage horse. >> the great interplay of man and beast. but legal. >> this is ann's sport. i'm not even sure which day the sport goes on. >> one question about
dressage... what is it? >> it is actually ann's passion not so much mine to tell you the truth. >> if i could give you a choice of mitt romney becoming president in november or rafalca winning a gold medal. >> oh, gee, that's a tough one. >> what are the origins of dressage? did just one day some young horse say to his dad dad i don't want to charge into battle. i just want to dance! >> when i'm watching my horse it is like watching my children play sport. >> let's go, let's go! >> kick it! kick it! ♪ >> the final round at the olympics. ♪ >> well, fasten your seat belts or should i say saddle up?
>> eliot: now we've seen horses dancing but we still can't look at the president's kill list. more "viewpoint" coming up next. sir... excuse me, excuse me... can i get you to sign off on the johnson case... ♪ we built this city! ♪ ♪ we built this city ♪ [ cellphone rings ] ♪ on rock & roll! ♪ falafel. yeah, yeah, i love you too. ♪ don't you remember! ♪ [ orbit trumpet plays ] don't let food hang around. clean it up with orbit! [ ding! ] fabulous!
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vanguard: the documentary series that redefined tv journalism. >>we're going to places where few others are going. >>it doesn't get anymore real than this. >>occupy! >>we will have class warfare. >>i'm being violated by the health-care system. >>we're patrolling the area looking for guns, drugs, bodies. >>we go in and spend a considerable amount of time getting to know the people and the characters that are actually living these stories. >>the award winning series "vanguard" only on current tv. >> eliot: senior members of congress on both sides of the aisle have a simple question for the president. what gives him the power to unilaterally kill a united states citizen without any judicial oversight? it is acknowledged the president has signed off on specific targeted killings of individuals including u.s. citizens yet
despite continued challenges from members of congress, the administration refuses to provide the legal rationale for the president's claim to this extraordinary power. the targeted killings of american born terrorists anwar alallky triggered the debate and now an alliance of republican senators and the aclu is pressing for more information and an explanation. in the words of chris anders, legislative counsel for the aclu and i quote... it sounds kind of reasonable. joining me now is adam, mother jones reporter who has covered this issue extensively. thanks for your time tonight. >> thanks for having me. >> adam, let's get this straight. it is an extraordinary moment when the president is presented in the white house or the situation room with these sort of baseball cards. he says that person, that person, that person then the military goes out with drones or whatever it may be and kills him and he claims to have legal
authority but has never explained what the precise legal authority is. that's kind of bizarre. >> congress is supposed to conduct oversight over these sorts of covert operations but the problem is they don't explicitly know what the legal standard is because they haven't been given access to the memo. the memo is still secret. the administration hasn't really acknowledged or officially acknowledged it exists and last week, a group of republican senators started saying well, you know, this is a license to kill americans and we want to see it. we might agree with the administration but it is our job as members of congress to say hey, you know, what exactly is this and are you applying it correctly? >> eliot: it seems to me it is one thing to ask for the particular evidence that is highly secret, top secret to the highest level with respect to particular individuals and i can understand the white house saying we can't share that and have to maintain that for a particular reason. on the other hand, the legal
theory, this memo written by the office of legal counsel the highly theoretical smart folks who write the memos for president explaining his powers. they won't even explain what the basis of the power is, the legal theory. that's the part of it that deeply troubles me. >> right. i mean that's -- that's the part actually where republicans and democrats agree the most. which is that people should really know what the standard is here. and what is sort of troubling is that the administration was very open with the bush administration's torture memos but they haven't handed these memos over and it is sort of -- it is making people suspicious as to what's in them. you know, what the logic is. the administration has defended the policy publicly, presumably with arguments that are contained within the memo. they still don't want to share it. i think that makes a lot of people both republicans and democrats very nervous. >> eliot: this is perhaps a horrific metaphor but it is like mitt romney's tax returns.
show us the memo and what's in there. otherwise, we're going to presume the worst. the republican senators, john cornyn, i knew him when he was a. g., let's impute the worst possible motive in the midst of a presidential campaign. on the other hand on this one they happen to be right. they have senators joining them on this argument. >> the democratic senators have been more timid in crit sietdzing the president. i think part of the way the political process works is with self-interest. it almost doesn't matter if what they're pursuing is in the public interest. the problem is when people are being partisan and they're doing it for the wrong -- in a way that will harm the public interest. but in this case, this is sort of how the system is suppose to the work. one party is supposed to hold the party accountable even if they don't exactly have altruce tick motivations. >> eliot: one of the things that surprises me, there is a limited universe, the senior members of the house foreign service committees and equals on
the senate side, routinely given highly secret information. are briefed so there is some information flow between the two branches of government. yet here, the executive has been unwilling even to show them the theoretical legal memo, devoid ine if you redacted the particular information about individual kill decisions made by the president. that seems to be such a bizarre isolation of information i'm having a hard time as a lawyer getting my arms around it. >> right so the argument is congress is supposed to do oversight but how do they know if the administration is applying the legal standard correctly if they really don't know what the legal standard is. >> eliot: that's the point. we don't know what from the constitution what the legal standard is, what it should be. we do know the u.s. citizens, we know who they are at least we know the public names of those who have been killed. terrorists the factual record is sufficient. there hasn't been a jump to their defense of course. nonetheless there is something
problematic about knowing how far the boundary line goes. for instance does the justice department memo assuming it exists define a boundary between overseas kill and domestic killing. where does this go and where does it stop? >> one thing i'll say. i don't think it is clear all of the people who were killed are terrorists. there is a lot of evidence about alallky and another one that was killed was his 16-year-old son. i don't think the government has presented evidence he was a terrorist. as far as the limits of the powers go, what we know from "the new york times" which reported on this last year, what they've said is that to the extent the authority exists, it applies to quote-unquote limited circumstances in which you know an individual is out of the country, they're beyond the reach of traditional law enforcement and the country that they're in is either unable or unwilling to act in a way that neutralizes this person either by handing them over or something like that. >> eliot: very quickly adam, do you think that one of the amendments mandating disclosure of the legal memo will pass to
one of the appropriations bills or something else the president couldn't veto if the next couple of months? >> it might pass but it doesn't mean the administration will comply. the language in the intelligence bill gives them an out when it comes to covert action and they can invoke executive privilege. there is no -- even if the language passes, even if something like this mandates disclosure, it is entirely possible that the administration will say this is outside of congress's power to demand and we're not going to comply. >> eliot: an issue we'll continue to monitor. adam, thank you so much for your time tonight of mother jones. >> eliot: a plan for struggling homeowners. wall street hates it so it might be a great idea. >>it's the place where democracy is supposed to be the great equalizer, where your vote is worth just as much as donald trump's.
>> eliot: businesses have a right to their opinions but so do their customers. first though, let's head west to the to "the war room" and check in with jennifer granholm. good evening governor. what have you got for us tonight? >> jennifer: eliot, what a week for mitt romney. the real issue does america want to put a mouse in the white house? "newsweek" and "daily beast" did a cover story called the wimp factor. in our latest chapter of mitt's secrets and lies, we'll look at how he's botched and flip-flopped on this overseas trip. author, michael tomasky will be joining us from "newsweek." we'll take a look at the polarizing tea party poster boy allen west facing a challenger in november. his name is patrick murphy from florida. you'll meet him tonight in "the war room".
>> eliot: where would they put the horses in the white house? we'll be watching. more "viewpoint" coming up next. >>you couldn't say it any more powerfully than that. >>it really is incredible. >> eliot: maybe it's because it is the hot dog days of summer but a lot is going on in the political world of chicken sandwiches. it all began when chick-fil-a ceo dan cathy made clear his far right views on same-sex marriage. and attention was drawn to his significant contributions to anti-gay causes. that moved to boycott the
company led by a slew of mayors and folks myself included who said we shouldn't leave our dollars at a company with views so fundamentally odds with our own. there was also a countermove. former governor mike huckabee of arkansas called on all of es those agreed with cathy to go to chick-fil-a tomorrow to show their support for the company. then came the humorous responses like that of actor and comedian steve martin who tweeted had dinner at chick-fil-a then i married a man. there was something about that sandwich. then there were the reactions that went abridge too far. christine quinn president of the city council here in new york suggesting that maybe restaurants whose owners had views she disagreed with shouldn't be here in the city at all. i haven't seen her suggesting the catholic church leave town even though its views on similar sex issues mirror those of chick-fil-a's ceo. "the new york times" rapped her knuckles for her position. the folks whose views are at
odds with mine or yours of course have the right to run their businesses as long as they comport themselves in accordance with the law. they shouldn't be prevented from opening their shops and selling their wares. government has no business telling them what to think or how to proselytize but we as consumers also have every right to take our dollars somewhere else. so much for the chicken sandwiches i used to love. and while we're at it, there are a couple of other companies we should think about leaving behind. take brawny paper towels owned by the koch brothers who fund every far right superpac under the sun. i don't know if bounty is the quicker picker upper and they claim but i'm going bounty over brawny from now on. i don't know if koch brothers owned angel soft toilet paper is more squeezable than charmin but i'm going with charmin. point is they have the right to make their goods and be here and proselytize all they want but we as consumers have the right. i might even say obligation, to react accordingly and take our
>> eliot: desperate times call for desperate measures on the day that edward dimarco acting director of the housing finance agency rejected the possibility of mortgage write-downs for struggling homeowners with loans guaranteed by fannie mae and freddie mac the search for creative answers to the mortgage crisis continues. one has emerged from steven cluck -- gluckstern who knows finance. use the government's power of eminent domain to buy back debt from banks at its current discounted value then refinance
the underlying mortgages based on the current market value of the homes. san bernardino county where roughly half of the homes are underwater wants to act on the plan but predictably, wall street is balking. i don't see how you could find anything other than appalling. but here is the argument. homeowners would get reduced mortgages, banks would get fair value for the debt they own and the economy would get a boost. it is complicated but don't worry, steven gluckstern is here to explain it to you. all right. give me a hint. explain all of the words. eminent domain to buy back debt. who's doing what to whom? >> thank you for having me on, eliot. eminent domain is a power that government has to acquire property owned by private citizens. we classically think of it as purchasing real state but that power can also purchase financial instruments. the government has an obligation to show it is doing it for a public purpose and it must pay fair value but if it does so, it
is allowed to acquire that particular asset. >> eliot: the way government buys land to build a road or stadium. >> correct. >> eliot: here they're going to buy back the debt that's out there, owned by whom right now? >> it is owned by banks and other owners of mortgages who have acquired it through transactions and bondholders. >> eliot: right now, it is written down because the underlying value of the mortgages has gone way down. >> the target of our particular program is financial securities that have already been written down so they reflect already the fact that this is the homeowner who is underwater so that when the owner of that receives the cash, they get fair value for what it is they have. >> eliot: let's say i'm the bank. you buy the debt from me. you're paying me what it is worth. right now, the homeowner hasn't seen his or her mortgage reduced. what are you going to do for the home own summer. >> the key to the plan is to keep people in their homes. we know there is a recovery problem in this country. many of white house argue
despite what mr. dimarco would say, unless we have principal write-downs, we can never have the recovery. that homeowner someone who bought a house for $400,000, they took out a $300,000 mortgage and they woke up and their house is worth $200,000. they find themselves underwater by $100,000. that homeowner never has the prospect of seeing equity again unless you write the mortgage down. what our plan calls for is the fact that the holder of the mortgage has, in fact, already taken the loss. they're not carrying that at $300,000 anymore. the problem is the homeowner still owes $300,000. so in our plan, a local municipality would acquire the loan for fair value some number less than $200,000 which is the value of the house and work with the homeowner to go from a $300,000 obligation to in this example, $190,000 obligation. >> eliot: on a house that is worth $200,000 that now makes economic sense. but i'm the bank. i'm annoyed.
you're forcing me to sell you an instrument for fair market value but i may not want to sell it to you. why are the banks upset? >> the answer is they might have a view that that mortgage over time could be worth more money. if there is a recovery, perhaps the loan might be worth $10,000 more in the future and by the way, i understand that. we all understand that. the fair value takes that into account. today the loans trade. we can determine exactly what people think the value is. >> eliot: what you're saying to the bank is we're going to pair you the fair market value. we can have an arbitrator, some neutral principal determine what that is. >> eminent domain is that process that assures both parties in fact have to pay fair value. >> i'm the lawyer at the table. as a matter of law, this is constitutional something litigated up to the supreme court no doubt. i'm sure the delay is something that troubles you. as a matter of principle eminent domain can extend to this. why has this not happened yet? where is the political hangup? what do you think the consequences would be if we did
it? >> why it hasn't happened today is because some people don't believe it is in their best interest. some people, the various members of wall street and owner of the bonds may not like this. they have a lottery ticket waiting to see if there is a recovery. there are structural problems in the securitization business. we talk about banks owning loans. banks own 20% of the loans. rest are owned through securitizations. there are structural legal problems there. but i am actually very optimistic and the reason it needs to happen is the fact is the american public is overlevered. we have overleveraged throughout our society. unless you reduce the principle the homeowner can never fully participate in our economy. that's the issue. >> eliot: one question, where is the money coming from to buy the debt. you're talking about a huge sum of money even if have you the discounted value. where is the money coming from? >> the money is going to come from the very people that buy mortgages. just to take a minute to explain the program a little bit. the local municipality basically
acquires an existing mortgage. it then works with the homeowner to restructure the mortgage which is then sold into the fha programs. we have a lot of really good programs in place in the united states. the fha and the administration has done a good job in implementing things that can work. they just haven't worked yet. we expect to take advantage of sort of their foresight in setting up the programs. existing programs to allow us to fund them. >> eliot: there's capital out there that would buy this debt if it were discounted to reflect the underlying value of the mortgage so there would actually be good debt with a payment structure. >> absolutely. now we have $190,000 mortgage with an fha guarantee on a $200,000 house is what people buy every day. >> eliot: to sounds to me like the opposition is from somebody who bought a lottery ticket thinking at the end of the day they would wait until the loans were worked out. the price would go up. they don't want to be forced to sell at what is today's market value. even though it is a market value because they think the payback down the road will be better. >> personally, i find that --
that's tough for me to understand. they're benefitted by a recovery of our economy. it is not just about this one loan or this one trust. if we can do this, you'll find out that that homeowner now participates back in the economy and that's what we need. we have 12 million underwater homeowners in this country out of 55 million mortgages. it is a shocking number. they're not really participating in what we need. that's why there is no recovery. >> eliot: likelihood of success. are you gets support for the plan? it is creative on capitol hill, the treasury department and agencies in washington? >> i would say the response has been anywhere from teptoid very strong. everyone is very interested. this is a solution. principal write-down is what we need to fuel the recovery and we've had a lot of support. people have asked questions and we continue to inform them. there is a lot of misinformation and good information but we're very confident this will see the light of day and more importantly, help homeowners. >> eliot: we will be following this. creative idea. something we desperately need. steven gluckstern, chairman